Tesla = 15% Of Luxury Car Sales In USA
Tesla had the #1 top selling luxury car in the USA in the first quarter of 2019, but it didn’t win the title of top selling luxury car producer in the first quarter and also didn’t top the list of luxury automakers (cars + SUVs/CUVs/trucks). However, the Silicon Valley company did stay on the podium despite a 50% cut in the federal EV tax credit for Tesla buyers and despite the fact that most Tesla vehicles were shipped abroad (with the Model 3 making it overseas for the first time).
Overall, Tesla only trailed BMW and Mercedes-Benz in premium-class car sales in the first quarter. It held 15% of this portion of the car market.
If you look at all luxury vehicles (not only cars), Tesla drops several places, ending up #10 in the luxury automaker market. It had 7% of the market in Q1 2019.
Related: Tesla Model 3 = #1 Luxury Car In USA
What do we make of all this? Well, there are surely drastically different ways to interpret the results and the multi-quarter trends. There are also vastly different implications for the future of Tesla.
First of all, it’s worth remembering Tesla sells only three models — a large sedan, midsize sedan, and large or midsize SUV (depending on how you measure). The other automakers have several different models for different tastes, budgets, and needs. Most notable is that Tesla lacks a small SUV/crossover, which will of course be the Tesla Model Y once it’s on the market in 2020 or 2021.
Even with just three models, though, it’s easy to see much room for Tesla to grow. As you’ll see in a coming sales report, the Tesla Model 3 was the #1 luxury car in the US in the first quarter, but it only had 16% of the small + midsize luxury car market. I say “only” because the Model 3 is significantly better than the competition and also has a much lower total cost of ownership. In fact, the Tesla Model 3’s 5–10 year total cost of ownership is competitive with that of the 10 best selling cars in the country, which the Model 3 absolutely crushes in practically every other way.
Whether by stealing sales from premium-class competitors or mass-market cars, the Model 3 has a lot of room to grow. Aside from normal consumers, consider the attractiveness of the Model 3 for fleet buyers, rental car agencies, etc. Model 3 drivers can feel like they’re in a high-end premium-class vehicle while benefiting from Camry-like costs and probably industry-leading resale values.
Additionally, aside from the Model 3’s potential to take more market share, the Model S and Model X are arguably much more competitive than first quarter sales indicate. It’s unclear what exactly happened to these models in the first quarter, but they should rebound over time.
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The #1 barrier to Tesla consumer demand growth is lack of consumer awareness and experience. Many Americans still don’t know almost anything about Tesla. Many others have collected their (mis)information from misleading or outright false new reports. They think Teslas aren’t safe (even though they’re the safest vehicles on the market), Tesla the company is in a precarious financial situation (even though it isn’t), and buying a Tesla doesn’t offer any notable benefit over a “normal” car (clearly, that’s a laughable assumption).
More consumers need to learn about Tesla and experience a Tesla. There are many ways they could gain that knowledge and experience. We’ll see how effective Tesla’s efforts to attract new buyers are in the coming quarters and years. Stay tuned, and let us know if you find any interesting information.
Interested in buying a Tesla? Need a referral code to get 1,000 miles of free Supercharging? Use ours: http://ts.la/tomasz7234 (or not — up to you).
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